What Does it Take to Pass the NMLS Exam?

Advice from an Experienced Exam Prep Trainer

By SAFE MLO EXAM PREP & Rich Leffler

Let’s face it!  There are many more appealing activities in which one can get busy than preparing for an exam, especially the NMLS National MLO Licensing Exam.  But,plainly and simply, if you want to originate residential mortgage loans securing properties located throughout the United States and its possessions through a non-depository institution, you are going to have to secure a mortgage loan originator’s license.  And, to secure that license, among other things, you will have to pass the NMLS National Mortgage Loan Originator Licensing Exam.

On July 13, 2021, the Conference of State Bank Supervisors (CSBS) reported that the NMLS exam’s overall pass rate is a measly 53%! [1]In other words, slightly less than half of those who sit for this exam never pass it.  And that is an astronomically high failure rate for an exam of this caliber. Pass the NMLS exam!

So what makes this such a hard test to pass?First of all, there is, without argument, an exorbitant amount of material that the test candidate must master in order to pass this exam; there’s simply no way around that.  To pass this exam, you must learn just about everything that an actively-producing mortgage loan originator must know in order to effectively, appropriately, and compliantly serve their customers and the industry in which they operate.  Unless the test candidate is genuinely committed to devoting the appropriate amount of time to adequately and effectively preparing for this exam, they can count on joining the ranks of the 47% left behind in Sulksville.

Lesson number one!  DO NOT schedule your NMLS exam immediately after completing your 20-hour course.  You still have a lot to learn that the 20-hour course did not cover.  Scheduling it too far out, however, might cause you to forget the things that the course taught you.  So, when is a good time?  Hang on.  I’ll actually get to that in a bit!

Another reason for this exam’s comparably-low pass rate involves the 20-hour pre-licensing education course itself.  The 20-hour course is the primary means of preparing people for this exam.  But,considering that this course requires the effective delivery of approximately 150 hours’ worth of material in a 20-hour time frame, even though there are some exceptional 20-hour course providers executing this course, no 20-hour course provider, however competent and thorough, can effectively deliver 150 hours’ worth of material in a 20-hour time frame.  It’s simply not possible.  In order for them to finish on time and cover what they’re required to cover, 20-hour course providers find themselves forced to skim over the surface of less than half of what the test candidate needs to know.  Consequently, the test candidate is frequently left alone to fill the gaps where the 20-hour course fell short, often with no idea of where to turn or in what direction.

So How Do You Do It?

Passing the NMLS National Licensing Exam comes down to four considerations:

  1. Knowledge
  2. Practice Exam Proficiency
  3. Causal Conversation
  4. Strategy


Knowledge is derived from mastering the material appearing on the NMLS National Test Content Outline.  The NMLS National Test Content Outline, available at:


is not only the guideline used by 20-hour course providers to create their courses,but also is what the State Regulatory Registry (SRR)uses in creating and modifying the NMLS exam.

The National Test Content Outline is the resource that every NMLS exam candidate should use to guide him or herself through his or her study regimen.  To appropriately benefit from this document, the test candidate should start from the top and work their way down, item by item by item.  Learn about the first item and, once you’ve mastered that, check it off, and move down the list. Repeat this process until you’ve reached the end. But don’t panic!  The outline contains a decent number of generalizations and redundancy, so even though there is absolutely a lot to learn, its bark is much worse than its bite!

As you progress down the Content Outline, study and learn through utilizing the materials at your disposal including:

  • All material that you received from your 20-hour course provider;
  • The resources constituting the last two pages of the Content Outline; and
  • The Internet

When using the Internet, however, be absolutely certain to vet your sources.  It’s critical to ensure that the websites from which you’re studying are valid and reputable sources of information.  Unfortunately, there is a plethora of obsolete and inaccurate information easily found on the Internet.  Therefore, it is imperative to ensure that anything found on the Internet and from which you study is current and emanates from a reputable source (a government entity versus Bob’s Bank or Julie’s Credit Union).

Although the current version of the National Test Content Outline is the most current version available, there are three regulations with which you should have a general familiarity that it neglects to feature.  You will, therefore, want to have a generalized overview of:

  1. The Community Reinvestment Act (CRA);
  2. The Housing and Economic Recovery Act (HERA); and
  3. The Fair Housing Act (FHA)

Practice Exam Proficiency

Quality practice exams are an extremely important part of one’s exam preparation regimen.  But I must warn you!  Practice exams should never be a test candidate’s sole and primary means of preparing for this exam.  You see, no practice exam may ever replicate an actual test question.  Doing so would constitute a gross violation of CSBS and American Association of Residential Mortgage Regulators (AARMR) policy.

Test candidates who prepare solely by taking practice exams typically end up memorizing the questions and their answers without understanding the meanings behind them.  And these are questions that they will never see on the actual exam.  So, when the test taker enters their exam brimming with confidence because they’ve memorized all of the questions on numerous practice exams, they’re immensely disheartened when they find themselves floundering to answer the questions that they’re actually presented,only to fail the NMLS exam miserably.

Instead of simply memorizing practice exam questions and answers, NMLS exam candidates should focus on understanding the questions presented through quality practice exams, their answers, and the explanations that the practice exams provide.  Once the test candidate is consistently scoring in the mid-to-high 90’s on quality practice exams, he or she is well on his or her way to success.

High-quality practice exams, at an extremely-reasonable price, may be acquired through www.safemloexam.com.

Casual Conversation

There’s a difference between knowledge and understanding.  Anyone can memorize facts.  It’s of vital importance, therefore, to study and prepare for this exam by focusing on understanding instead of simple knowledge.  Consider joining networking groups through social media platforms and other venues in order to conduct discussions with other test candidates about the topics you’re learning.  This way, not only will you continue to learn through each other, you’ll reinforce your own knowledge and understanding while identifying areas in which you may be able to improve your understanding.  Understanding allows the individual to apply that knowledge in various contexts.  Little reinforces knowledge more than being able to conduct an articulate discussion about the particular subject matter.


There’s no question about it; this exam is tricky.  After all, the SRR wants to ensure that those who enter the mortgage industry earn their way into it.  In addition to mastering the required material, the successful exam taker must be able to effectively navigate the tricky nature of this exam.  The following strategies should help you accomplish just that.

Number One – STUDY!

You and only you determine whether or not you pass the NMLS exam.  Whether you ultimately travel down the pathway of passing or the pathway of failing is solely and completely at your discretion.  The one and only way to travel down the pathway of passing, however, is to study!  There’s no need to mince words here.  Not studying or studying inadequately means not passing.  And, if your idea of studying consists of reading a few pages from your 20-hour course material at night when you get into bed before you fall asleep, or in the morning when you first wake up before heading off to work, or on your lunch break, yeah, that’s not going to cut it!  Appropriate studying consists of setting aside definitive time, every day, and studying like it’s your job.  Studying like a boss.

Several years ago, I found myself in Doral, Florida teaching a live, 20-hour course.  That meant that I had two-and-a-half days to effectively deliver one hundred and fifty hours’ worth of material.  All throughout the time when I was there, I would repeatedly emphasize to the students, “You need to study!  You need to study!  You need to study!”  They were so tired of hearing me say that that, when I would reenter the classroom after a break and before I could even get back up to the podium, I would hear students murmuring, “We know!  We know already!  You don’t have to tell us anymore!  We need to study!  We get it!”

Unfortunately, only half of those students ultimately passed the NMLS exam.  And, when their employer polled the employees who failed to ask them why it was that they believed that they failed, just about every single one of them replied that it was because they did not study enough.  Take that or leave it.  But the bottom line is that, if you want to pass this exam, you must appropriately and sufficiently study.

Number Two – Third Time’s The Charm!

One of the most important tips that I can share with you is one of the hardest to follow. But it’s imperative that you do just that!  It doesn’t matter how easy the question is.  It doesn’t matter if the question is, “What is your name?”Be certain to read every single question and every single answer option no fewer than three times before answering.

Your eyes and your mind tend to work at different speeds.  Often your eyes see something that your mind interprets differently.  And then, when you proceed with your mind’s interpretation, you get the question wrong.  You cannot afford to make mistakes like this on the NMLS exam.

I absolutely forced myself to read every single question and answer option three times before answering when I took the NMLS exam and, although doing so was in no way easy, I caught myself, on several occasions, about to incorrectly answer a question that, had I not read it a second and a third time, I would have incorrectly answered.

Please take a moment to answer this question and please do so without reading the question-and-answer options three times.

“At what equity position is PMI automatically removed assuming that the loan is current”

  • 78%
  • 80%
  • 20%
  • 22%

Now be honest.  Did you answer, “A?”  The correct answer was “D!”  Answer option “A” would have been the correct answer had the question asked, “At what LTV is PMI automatically removed assuming that the loan is current?”  But the question didn’t ask about “LTV,” did it?  No!  It asked about “equity.”  If you answered, “A,” chances are that your eyes read, “equity” while your mind thought “LTV.”  And when you went with your mind’s interpretation, you got the question wrong.  You can afford to commit this error here.  You cannot afford to do so on the actual exam.  Therefore, please read every single question and every single answer option no fewer than three times before answering.

Number Three – Trust Your Gut!

In working with people seeking to pass the NMLS National Licensing Exam, I frequently encounter individuals who are pursuing the coveted win for a second and even third time.  When I find myself working with such a test candidate, I typically ask them how often, if at all, during their previous attempts did they change an answer once they answered the question.  More times than not, the reply that I receive is that they did so fairly frequently.

We all have an instinct.  Call it that,or a sixth-sense, or even intuition that operates on a subconscious level.  This instinct is there to protect and serve us.  And we should afford it the respect that it deserves.  When one changes an answer from one to another in the absence of a definitive reason, more times than not they’re subverting this instinct by self-sabotaging and shooting themself in the foot.  More times than not, in the absence of a definitive reason, when one changes the answer after initially answering, he or she is changing a correctly-answered question to an incorrectly-answered one.Plainly and simply, in the absence of a definitive reason, the test candidate is encouraged to resist the urge to change their answer and trust their gut.

In the presence of a definitive reason, however, the test taker should always change their answer appropriately.  “Oh!  It’s not three times three.  It’s three plus three!”  Yes!  In this case, please change your answer from nine to six.  But, in the absence of a definitive reason, you will be best served to resist changing your answer and trust your gut!

Number Four – NEVER Leave an Answer Blank!

If you leave an answer blank, you have a 100% chance of getting the question wrong.  At least if you guess, you have a 25% chance of guessing correctly.  And if it comes down to guessing, there are even some strategies that you can employ when doing so.

If a question comes down to a guess, try utilizing the process of elimination.  If you can definitively eliminate one or two answer options that you know, for a fact, are incorrect, even if you still end up guessing, you dramatically increase the odds of guessing correctly.  And please think about this!  If you can definitively eliminate three of the answer options that you know, for a fact, are incorrect, even if you have no idea what the remaining answer option means, you correctly answer the question through the process of elimination.

If process of elimination is not an option and you still have to guess, another guessing strategy would be to identify an answer option that acts in the customer’s bests interests over the others.  If you can identify such an answer option, go with that one as your guess and you’ve most likely answered this question correctly.

If using the process of elimination and identifying an answer option that acts I the customer’s best interests are not viable options and you still have to guess, the last resort would be to choose between answer options “C” and “D.”

One of the tricky tactics that the test administrators sometimes utilize is to put the trick answer and the close-but-no-cigar answer options in the “A” and “B” positions.  I suspect that they do this so that the test taker grabs it, gets the question wrong, and fails the exam.  Therefore, if it comes down to a completely blind guess, and, by that I mean that the question and the answer options may as well be written in a language that you do not speak, look at answer options “C’ and “D,” if one of them acts in the customer’s best interests over the other one go with that.  Otherwise, take a 50/50 guess between them and move on to the next question.

Number Five – You Must Be Well-Rested and Clear-Minded When You Sit for This Exam

As previously mentioned, the NMLS exam is tricky.  And if you go into it tired, not feeling well, hangry, hungry, or otherwise distracted, it will seriously detract from your ability to perform well.  So here is what I recommend that you do.

Study, study, study like a fiend up until the day before the day before your exam.  If your exam is scheduled for Tuesday, study like a fiend through Sunday.  Sunday comes and goes, and you are done.  Take the next day, Monday, the day before your exam and make it all about you.  Eat your favorite foods.  Do your favorite things.  Do you like the theatre?  Go see a show.  Is there a movie that you’ve been wanting to catch?  Go catch it!  Do you like fishing?  Go grab that rod and reel.  Is golf your passion?  Go hit the links.  Go to a spa.  Get a massage, a manicure, a pedicure.  Pamper yourself.  I’ll go so far as to suggest that you check into a hotel close to your testing center … by yourself!  Spend the day in bed reading.  Sleep the day away.  Lounge out by the pool.  Eat a healthy and nutritious dinner.  Go to bed at a reasonable hour.  Turn off that cell phone (hotels still offer free wake-up calls).  Get up at a reasonable hour.  Go hit the hotel gym if you can.  Get the endorphins coursing through your brain.  Go eat a healthy and nutritious breakfast and then, because you’re at a hotel that’s close to the testing center, you won’t have to worry about traffic on your way over to the testing center.  Do some of that, all of that, or something completely different.  But whatever it is that you do end up doing, you must be well-rested and clear-minded when you sit for this exam.

Number Six – Study for Understanding and Not Just Knowledge

When you bring your car to a mechanic, you expect the mechanic to know what a tire is, right?  Of course!  But I would also venture to say that you would want that mechanic to know what a tire does in relation to a wheel.  What the wheel does in relation to the axle.  The axle to the drive train, the drive train to the transmission, and the transmission to the engine.  You expect your mechanic to know about the parts that make up the car, but he or she should also know how all of those parts fit together to form the fully-functioning automobile.

Similarly, the prepared test candidate will be able to know not only the things that comprise the mortgage originations industry, but how those things all fit together to form the process of mortgage loan originations.  You should be prepared to solve for double, triple, and quadruple negatives.  Imagine being presented with a question that asks,

“In accordance with REG B, except for which of the following is not prohibited?”

This could prove quite intimidating for the unprepared test taker. Two fairly effective strategies for deciphering questions such as this consist of word rearrangement and reduction.

By changing the order in which the question’s words are presented, meaning may become clearer.  “Which of the following is not prohibited, except?”  This brings you one step closer to understanding what the question is asking.  But then, combined with the process of “reduction,” meaning becomes crystal clear.

Reduction involves eliminating multiple words and replacing them with fewer words that carry the same meaning.  And, in this example, we can do this by eliminating the two words, “not prohibited” and replacing them with the one word, “allowed.”  When both strategies are combined, we’re left with, “Which of the following is allowed, except?”  So now it becomes apparent that we’re looking for something that is not allowed.

The four answer options to this imaginary question consist of two regulatory requirements and two regulatory prohibitions.  We can now immediately eliminate the regulatory requirements.  Of the two remaining answers, one is a prohibition of ECOA and the other of TILA.  So, at this point, all we’re left needing to know in order to correctly answer this question is that the Equal Credit Opportunity Act is the act that operates under Reg B.

Number Seven – You Must Believe in Yourself

Everyone knows the story of The Little Engine That Could. [2]  In short, a train was struggling to make its way up a mountain all-the-while thinking to itself, “I think I can.  I think I can.  I think I can.”  And it wasn’t until the train changed its thinking to, “I know I can.  I know I can.  I know I can” when it was finally able to surmount the hill’s apex and come down the other side.

Thought precedes reality.  Therefore, even if you have your doubts and concerns about passing the NMLS exam, it is critical for you to consciously control your thinking so that you’re repeating and reinforcing, “I’m going to pass this exam.  I’m going to pass this exam.  I’m going to pass this exam.”  And, between this type of positive visualization combined with effective study practices, just watch the good things that unfold.

In Conclusion

The litmus test to identifying readiness for the NMLS exam involves several components.  Once the exam candidate:

  1. Is thoroughly familiar with everything appearing on the National Test Content Outline;
  2. Is consistently scoring in the mid-to-high 90’s on quality practice exams;
  3. Can carry on a casual conversation about the material presented on the Content Outline; and
  4. Is prepared for the tricky nature of the exam itself

at that point he or she will have a higher-than-average likelihood of successfully navigating the tricky waters of the NMLS National MLO Licensing Exam.

[1] Website, NMLS, Test Performance Information, https://nmlsportal.csbs.org/csm?id=kb_article_view&sysparm_article=KB0016864&sys_kb_id=f86b9f0c1b993c508c04dbdbe54bcbb6, 09/21/2021.

[2] The Little Engine That Could, Piper, Watty, Illustrated by George and Doris Hauman, 1930

Other Articles:

Become a Mortgage Broker – First Pass Your Mortgage Test with SAFEMLOExam.com

NMLS Test Prep – 1,000 NMLS Practice Test Questions

Become a Mortgage Broker – First Pass Your Mortgage Test with SAFEMLOExam.com


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NMLS test prep - NMLS practice test

NMLS Test Prep – 1,000 NMLS Practice Test Questions

Once SAFE MLO Exam Prep has thoroughly prepared you to successfully tackle the NMLS licensing exam, it’s time to schedule your exam.  To do so, the test candidate should visit the NMLS’ Testing page located at:


and can pay for it, and schedule their examination. On the day of their MLO license test, the test candidate will sign in at the testing center by providing a valid, government-issued photo identification bearing a picture that closely resembles them.  Nothing may be carried in with the test taker aside from any medication that they may require and their identification.  Lockers will be provided for anything else that the test taker possesses, and the testing center will provide any supplemental material necessary for the student to complete their exam (calculator, writing implements, note paper, etc.).  The test candidate will be escorted into the testing area where he will have three hours to complete 120 multiple-choice questions.  When the test taker completes and submits his exam, he will immediately learn his test results.  To pass the exam, the test taker will have to achieve a grade of 75% or higher.

The 120 questions contained within the NMLS Mortgage Loan Officer test encompass five topics:

  • Federal Mortgage-Related Laws (23%)
  • General Mortgage Knowledge (23%)
  • Mortgage Loan Origination Activities (25%)
  • Ethics (16%)
  • Uniform State Content (13%)

The test questions will not, however, be presented in categories.  The test might begin with a question on Ethics followed by three on Federal Mortgage Law followed by one on Ethics followed by one on USC.  The test candidate should be thoroughly familiar with all five subject areas prior to sitting for his exam.

Each multiple-choice test question will generally contain one answer option representing the best possible option (the correct answer), an answer option that may be correct but, for various reasons, is not as good as the actual correct answer, a “tricky” answer option, and an answer option that doesn’t belong.  The test taker’s goal is to choose the best possible answer to each question.

Of the 125 NMLS test questions and answers, ten count neither towards the test taker’s grade or against it.  The NMLS’ purpose for including ten “test” test questions that do not count for or against the test taker’s grade is so that they can decide whether to include that question as a “live” question on a future exam.  Test takers should treat all test questions as “live” questions since there is no way to detect or identify a “test” test question.

If a test candidate fails the NMLS license test, he may take it a second time.  He will, however, be required to pay for another attempt at the mortgage test and wait 30 days.  If the licensing candidate fails the loan officer test a second time, he may take it again.  Once again, however, he will have to pay for it and wait another 30 days.  If, after a third attempt, the licensing candidate again fails the SAFE MLO exam, a fourth attempt will require another payment as well as a six-month wait.

Submitting Authorization Allowing the NMLS to Obtain a Current Credit Report

Once the preliminary education has been completed and the mortgage license test successfully passed, the licensing candidate is free to apply for his license.  To do so, an application must be submitted through the NMLS’ website utilizing form MU4.  In filing this form, the license applicant must submit the cost of and authorization for the NMLS to secure a credit report to assess the quality of the applicant’s financial condition.  Be sure to review the individual state requirements to identify possible considerations that may prevent that state from issuing a license due to adverse credit circumstances.

Submitting Fingerprints and Authorization Allowing the NMLS to Conduct a Criminal Background Check

When filing the MU4 form, the license applicant must also submit finger prints along with the cost of and authorization for the NMLS to secure a criminal background check.  Be sure to check the individual state requirements to identify possible circumstances that may prevent a state from issuing a license due to previous criminal convictions.

Applying for the License Through the NMLS’ Website Using Form MU4 for Each State or Possession from Which a License is Desired

All licenses are applied for by submitting form MU4 through the NMLS’ website.

Once a state issues a Mortgage Loan Originator license, the licensee will be eligible to originate mortgage loans securing properties located in that state.  If the license is issued to an applicant who is unemployed, however, his license will be issued in an “inactive” status and may only be activated once the mortgage professional secures active employment through a licensed entity.  No mortgage loan originator may originate mortgage loans while his license is inactive.

Additionally, a mortgage loan originator may only originate mortgage loans on properties located within the state in which he is licensed.  If, for example, a Nevada-licensed mortgage loan originator lived in California right along the Nevada-California state line, he would not be permitted to originate mortgages on properties located in California unless he first secured a California mortgage loan originator license.

Mortgage loan originator licenses expire annually and must be renewed on or prior to December 31st of each year.  If a mortgage loan originator fails to renew his license by December 31st, he would be unable to originate any more loans or continue working on any files that would otherwise require licensure until such time that he renewed his license.  Although passing another loan originator exam is not required to renew one’s license, several states require the review of a current credit report and all states require the completion of a minimum of eight hours of NMLS-approved continuing education.  Some states require additional state-specific continuing education in addition to the standard eight hours.  Be certain to review the state-specific education requirements for the state(s) in which you will seek to renew your license(s).

Preparing for the NMLS Exam

As previously discussed, less than 50% of those attempting to pass the NMLS National Licensing Examination ever successfully do so. The key to ensuring success is thorough mortgage loan originator exam prep utilizing the following tools and strategies.

Study, Study, Study

The bottom line is that candidates preparing to tackle the national mortgage test need to study well beyond their 20-hour preliminary licensing education course.  As previously mentioned, the 20-hour preliminary licensing courses often fall short of adequately covering the topics upon which the test candidate may expect to be tested.  As such, additional study coupled with quality NMLS test prep is essential to positioning the licensing candidate for success.

The most effective way to prepare for the NMLS exam is to utilize the NMLS national test study guide offered through the NMLS’ website.  This NMLS Test Content Outline, found through


itemizes the various subject matter upon which the national preliminary education courses are created and the NMLS national exam is based.  This NMLS Content Outline should be used as a checklist and loan officer test study guide through which the test candidate can systematically progress, mastering all listed topics until fluent.  One proven study method for achieving mastery is the creation and use of NMLS exam flashcards.

Another effective means by which successful test candidates can prepare themselves for the examination is by taking multiple NMLS practice exams.  NMLS practice tests afford test candidates valuable SAFE MLO test prep by utilizing the subject matter and mortgage loan originator test sample concepts described through the previously-mentioned NMLS Test Content Outline. Ideally, test candidates should plan on completing multiple practices exams since completing only one NMLS practice test may not accurately represent test readiness.  Although candidates may be able to access an NMLS free practice test through an Internet search, many tests that provide NMLS practice questions free are outdated and lack sufficient relevance and quality.  SAFE MLO Exam Prep’s NMLS test prep program offers NMLS exam candidates current and applicable NMLS exam practice questions representative of the type of NMLS practice test 2017 and 2018 relevant questions that test takers are likely to encounter during their exam.  While serious test candidates should scrutinize and be wary of any free NMLS practice test upon which they may stumble, SAFE MLO Exam Prep clients rest assured knowing that any mortgage practice test that they complete through SAFE MLO Exam Prep strictly conforms to the SAFE exam study guide.  Additionally, SAFE MLO Exam Prep’s mortgage loan originator practice test incorporates all five test content areas of the mortgage study guide.  When you’re a client of SAFE MLO Exam Prep, there’s no need to purchase a separate UST practice test to master the uniform state test content.

Although it would be irresponsible to designate a specific time frame constituting adequate NMLS exam prep, repeatedly scoring a grade of between 90% – 95% or higher on SAFE MLO Exam Prep’s loan officer practice test may indicate that the candidate is approaching test-taking readiness.

While dedicated studying utilizing the SAFE MLO practice test is critical to appropriate SAFE mortgage loan originator test prep, studying, as the only test prep strategy, is not enough.  The following test-preparation and test-taking tips will prove helpful to your ultimate success:

Be Well Rested

Individuals who have taken the NMLS national exam generally agree that the test questions presented through the exam are tricky.  Knowing the material, although critical, is not enough.  When you eventually sit for this exam, you should be well rested and clear minded to maximize your chances of not being tricked into incorrectly answering a question.

Give Yourself the Full Three Hours

Although you may not need the full three hours, approach your exam schedule anticipating that you will.  It is better to finish early than suffocate under the pressure as the clock approaches the time when you planned on finishing while you still have more questions to answer.

Read Every Question and Answer Multiple Times

One way to minimize the chances of misinterpreting a test question is to read every test question and answer several times prior to answering.  In re-reading the question, you may discover something that you read incorrectly the first time.

Answer All Questions

Never leave a question blank.  If you do so, you have a 100% chance of getting it wrong.  Even if you don’t know the answer, at the very least guess!  If you guess, you have a 25% chance of getting the question right.

Use Process of Elimination

Test takers who do not know the answer to a test question will significantly improve their odds of correctly guessing the answer if they can eliminate one or more possible answer options.  In fact, if you’ve used the process of elimination to eliminate three incorrect answer options, you’ve correctly answered the question!

There’s Only One Best Possible Answer

Each question contains four possible answers; only one of them is correct.  One may be close but not as good as the best possible answer.  One may be tricky intending to lure you into incorrectly answering the question, and one may have little to do with the question being asked.  For this reason, it is critical to read every question and every answer multiple times before answering.

No Correct Answer

Should you encounter a question for which you’re certain that none of the answers are correct, do not panic!  Assume that the question is one of those “test” test questions, answer it to the best of your ability, and move on.

Study for Understanding Not Just Knowledge

When preparing for your exam, be certain to study for comprehension and not just knowledge.  Know how mortgage concepts and process work and blend together.  Study to learn more than just the facts.

Overstuffed Need Not Bloat You

If you happen to be asked a question that appears overwhelming at first glance, do not panic.  Sometimes questions will contain lots of extraneous details bearing little-to-no relevance to the question being asked.

Use the Tutorial

All exams begin with a tutorial.  Be sure to take the time to go through the tutorial as it often provides important information that you will need to know to successfully navigate through your exam.

SAFE MLO Exam Prep prides itself on effectively preparing test candidates for success in passing the NMLS test! Start Now and you will receive 1,000 NMLS practice test questions, study videos, flashcards, and reliable support from a licensed NMLS instructor!

NMLS test prep - NMLS practice test

How To Become A Loan Officer – The Licensing Process

Applying for a mortgage loan originator’s license involves a process that includes:

  • Registering through the NMLS’ website and securing one’s NMLS unique identifier
  • Completing the 20-hour preliminary licensing education course
  • Taking advantage of additional but optional mortgage exam preparation through a quality NMLS national test preparer such as SAFE MLO Exam Prep
  • Passing the 125-question national mortgage loan originator licensing exam
  • Submitting authorization allowing the NMLS to obtain a current credit report
  • Submitting fingerprints and authorization allowing the NMLS to conduct a criminal background check
  • Applying for the license through the NMLS’ website using form MU4 for each state or possession from which a license is desired
  • Registering Through the NMLS’ Website and Securing One’s NMLS Unique Identifier
  • Securing an NMLS number is free and easily accomplished by creating an individual NMLS account through the NMLS’ log-in portal located at:


If the individual works for a depository institution regulated by a federal banking regulator, all he is required to do is to register through the NMLS by establishing an account and securing his unique identifier.  An individual working for a non-depository institution must secure his unique identifier in addition to pursuing his MLO license(s).

Completing the 20-Hour Preliminary Licensing Education

All mortgage licensing candidates must satisfy the specific education requirements established by each state.  All states require the completion of the standard 20-hour preliminary licensing course conducted through an NMLS-approved loan originator test education provider.  These providers may be located through the NMLS’ website at:


Additionally, various states require additional, NMLS SAFE, state-specific education incorporated into or in addition to the 20-hour preliminary education course.  To determine the education requirements pertaining to the specific state(s) from which you may desire licensure, please reference the NMLS’ state-specific education chart at:


Taking Advantage of Additional but Optional Mortgage Exam Preparation Through a Quality NMLS National Test Preparer Such as SAFE MLO Exam Prep

Unfortunately, the process of preparing for the NMLS national examination is not ideal.  According to the NMLS, the SAFE MLO test attempts occurring between July 1, 2016 and June 31, 2018 resulted in only 54% of those attempting to pass the NMLS exam doing so.[1]  One possible reason for the 46% failure rate is because the 20-hour national course crams roughly 80 hours’ worth of content into 17.5 hour sof actual instruction (2.5 hours are allotted for breaks).  NMLS instructors must often resort to one of two options: they can race through the material barely scratching the topic’s surface while addressing few questions, if any,in order to cover everything listed on the course’s syllabus.  This, however, generally produces extremely confused and frustrated students.  On the other hand, instructors can devote the appropriate time and attention needed to achieve adequate understanding, but only finish 30-40% of the material listed on the course syllabus.  Consequently, test candidates are often left confused and struggling to adequately understand exactly what they need to understand in order to pass the exam.By the way, there is no specific mortgage lender test or mortgage broker test; only one national SAFE Mortgage Loan Originator test.

By adhering to the MLO study guide/NMLS study guide provided through SAFE MLO Exam Prep’s one-on-one individualized NMLS SAFE exam tutoring in conjunction with effective MLO test preparation provided through SAFE MLO Exam Prep’s numerous SAFE exam practice tests, each student receives the opportunity to accurately assess his knowledge of and appropriately prepare for the topics presented through the MLO test questions appearing on the national exam.  SAFE MLO Exam Prep is one of the industry’s prominent mortgage loan originator test prep providers helping NMLS test candidates successfully and correctly answer their SAFE exam questions.

[1] NMLS SAFE Mortgage Loan Originator Test Pass Rates, July 13, 2018, https://mortgage.nationwidelicensingsystem.org/profreq/testing/Documents/SAFE%20MLO%20Test%20Pass%20Rate%20Announcement.pdf

NMLS test prep - NMLS practice test

What Is The NMLS – Nationwide Multistate Licensing System & Registry

NMLS History & Background

I remember landing my first mortgage job as a Mortgage Customer Service Representative for a large bank in Buffalo, New York. The year was 1996 and, even though I had no previous mortgage or banking experience, the bank liked me and offered me the position. Admittedly, I was quite excited. I had just left the Emergency Medical Services for something different and this bank was going to teach me everything that I needed to know to become a steely-eyed mortgage star. Or so I thought.

I arrived for work on my first day expecting to be ushered into a formal training program through which I would be taught all that I needed to know. Much to my surprise, however, my entire training experience consisted of listening to a customer service representative answer customer calls for three days after which I was live talking to customers. Quite a surprise and even more of a shock. But that was the mortgage industry back then. Rules and regulations were sporadically enforced, rarely taught, and most mortgage training consisted of a “hands-on”, “learn-as-you-go” experience. And we all know where that eventually led us.

As a 2008 response to the mortgage industry crisis plaguing the country, and, to some extent, the world, the United States Congress enacted the Housing and Economic Recovery Act (HERA) as a means of healing the economy and bringing accountability to an industry that, up until then, had little-to-none. Title Five of HERA established the Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act).

The SAFE Act finally injected accountability into a previously-chaotic industry where mortgage professionals were concerned more about getting paid than looking out for their customers’ best interests. Through the SAFE Act, authority was issued to a centralized, national oversight system responsible for the licensing of non-depository mortgage loan originators, lenders, and brokers. This oversight system, known as the Nationwide Mortgage Licensing System (NMLS), was created through collaboration between the Conference of State Bank Supervisors (CSBS) and the American Association of Residential Mortgage Regulators (AARMR). The NMLS commenced operations on January 1, 2008 and is owned and operated by the State Regulatory Registry (SRR), a wholly-owned subsidiary of the CSBS.

The NMLS is the sole system that oversees mortgage professional registration and licensing for every state and U.S. possession. The NMLS oversees registration for any individual seeking to originate mortgages securing properties located in any U.S. state, Washington, D.C., Puerto Rico, the U.S. Virgin Islands, and Guam and also oversees licensing for non-depository professionals in those jurisdictions. In addition to mortgage loan originators, the NMLS oversees the licensing of mortgage lenders, brokerages, money service businesses, debt management companies including debt collectors, and consumer finance entities.For the purposes of this article, however, I will focus solely on individual mortgage loan originators.

To effectuate NMLS policies, the SRR Board of Managers formalized the NMLS Policy Committee, comprised of 11 state financial service regulators. All administrative decisions are made after considering input from participating state agencies, licensees, and the industry overall. The NMLS Policy Committee addresses the following types of issues:

• Regulatory policies that govern the NMLS
• NMLS development decisions
• Prioritization of NMLS functionality
• NMLS public comments
• Suppression requests concerning NMLS consumer access

Although individuals and entities seeking licensure ultimately do so through each individual state or possession from which they desire to secure a license, doing so is conducted solely through the NMLS system. Individual state licensing requirements may be found at:


In addition to facilitating the licensing of the aforementioned professionals and organizations, the NMLS is also responsible for documenting, retaining records of, and reporting licensing status conditions of the individuals and entities that it oversees to the public. Through the NMLS’ Consumer Access Portal, located at http://www.nmlsconsumeraccess.org, any member of the public can ascertain the registration status, licensing status, and/or disciplinary records of any registered or licensed mortgage industry participant.

Individual, Depository Institution

Anyone desiring to originate mortgage loans securing properties located throughout the United States, Washington, D.C., Puerto Rico, the U.S. Virgin Islands, and Guam, at the very least, must be registered through the NMLS system and possess an NMLS number also referred to as a “unique identifier.”An individual working for an exempt entity is not required to secure a mortgage loan originator license. Depository institutions are exempt entities.

Individual, Non-Depository Institution

If an individual desires to originate mortgage loans for a non-depository mortgage lender or broker, in addition to registering through the NMLS and securing their unique identifier, he must also secure a license through each state or possession in which he desires to operate. Although the NML centralizes the process of applying for one’s mortgage loan originator license, the licenses themselves are issued by each state or territory in accordance with its individual licensing parameters and criteria.

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[1] Website, 2018, NMLS Resource Center, About NMLS, System Governance https://mortgage.nationwidelicensingsystem.org/about/Pages/default.aspx